EMINENT DOMAIN
AFTER SENATE BILL
18
Texas City Attorneys Association
2012 Summer Conference
South Padre Island, Texas
June 6-8, 2012
Robert F. Brown
Brown & Hofmeister, L.L.P.
740 E. Campbell Road, Suite 800
Richardson, Texas 75081
214/747-6100
214/747-6111 (Fax)
bhlaw.net
[email protected]
Robert F. Brown
Brown & Hofmeister, L.L.P.
740 E. Campbell Road, Suite 800
Richardson, Texas 75081
(214) 747-6100
(214) 747-6111 Fax
[email protected]
www.bhlaw.net
Robert F. Brown is a founding partner in the firm of Brown & Hofmeister, L.L.P.
Mr. Brown specializes in litigation and appellate practice with an emphasis in municipal
law, including constitutional law, civil rights, and zoning and land use matters. Mr.
Brown has argued three cases before the Texas Supreme Court on behalf of Texas cities.
In addition to his litigation practice, Mr. Brown acts as city attorney for a number of
municipalities in the North Texas area. Mr. Brown received his law degree in 1986 from
the Texas Tech University School of Law and his Bachelor’s Degree in Business
Administration from Texas A&M University in 1983. He is a former chair of both the
Federal Litigation Section of the Federal Bar Association and the Government
Operations, Liability, Transportation and Public Employment Committee of the State and
Local Government Law Section of the American Bar Association.
Mr. Brown is a frequent author and speaker on civil rights and land use matters,
with over 100 articles and presentations to his credit, including “Litigation Under the
Fair Housing Act: Practical Tips for Attorneys and Planners,” published by Matthew
Bender & Co. in its 2007 Institute on Planning, Zoning and Eminent Domain proceedings
;“Individual Immunity Defenses Under Section 1983,” published by the American Bar
Association in its 2006 publication Sword and Shield: A Practical Approach to Section
1983 Litigation (3rd Edition); “Update on Exactions: The Texas Experience,” published
by Matthew Bender & Co. in its 2004 Institute on Planning, Zoning and Eminent Domain
proceedings ; “Trying the Case,” published by the American Bar Association in its 2000
publication How to Litigate a Land Use Case; “Immunity for Public Officials in Land Use
Cases,” published by Matthew Bender & Co. in its 1997 Institute on Planning, Zoning
and Eminent Domain proceedings; and “Seeking Terra Firma in Complex Zoning
Litigation: The Defense Practitioner's Perspective,” published by Matthew Bender &
Co. in its 1994 Institute on Planning, Zoning and Eminent Domain proceedings.
Mr. Brown was named one of the “Best Lawyers in Dallas” by D Magazine in
2007, 2008 and 2009.
i
TABLE OF CONTENTS
Forward .................................................................................................................... i
Table of Contents ...................................................................................................... ii
I.
Senate Bill 18:
The Next Step in Eminent Domain Legislative Reform ....1
II. Senate Bill 18 Changes Impacting Texas Cities ................................................3
A. Changes to Government Code Chapter 2206...............................................4
1. “Public Use” Versus “Public Purpose” ..................................................4
2. “Truth in Condemnation Procedures Act”..............................................6
3. Breaking Down the New Procedural Requirements...............................9
4. Condemnation Sunset Provisions .........................................................13
B. Changes to Property Code Chapter 21 .......................................................13
1. Disclosure of Appraisal Reports...........................................................14
2. Prohibition of Confidentiality of Acquisition Offer or Agreement......14
3. Bona Fide Offer Required ....................................................................15
4. Some Practical Bona Fide Offer Requirement Considerations ............16
5. Condemnation Petition Changes ..........................................................18
6. Commissioners’ Hearing Changes .......................................................19
7. Disclosure of Right to Repurchase .......................................................20
8. Right to Repurchase..............................................................................21
ii
9. Relocation Assistance Program ............................................................24
10. Change of Access Impairment Compensability Standard..................26
III.
Closing Thoughts About Senate Bill 18 ........................................................27
APPENDIX ..............................................................................................................28
iii
I.
Senate Bill 18:
The Next Step in Eminent Domain Legislative Reform
On May 23, 2011, Texas Governor Rick Perry ceremonially signed Senate
Bill 18, which had been declared an emergency item for the 2011 Legislative
Session. According to Governor Perry and three of the bill’s primary sponsors
(State Senators Craig Estes and Robert Duncan, and State Representative Charlie
Geren), the bill had been in the making for over a decade.1 At the signing party,
Governor Perry declared that he was “proud to sign into law stronger eminent
domain provisions protecting Texas landowners from local and state government
entities that might consider abusing private property rights.”2 Senator Estes echoed
this theme when he stated that “Texas is thriving as a state and property is a
valuable asset, but that growth should not come at the expense of property
owners.”3 But perhaps Texas Agricultural Commissioner Todd Staples best
summed up the landowner’s rights theme underlying the passage of Senate Bill 18,
when he stated: “The signing of this bill says, ‘Don’t mess with Texas, and don’t
mess with Texas land.’ SB 18 sends a clear message that here in the Lone Star
State, we hold dear to our heritage of land ownership.”4
Much of the recent efforts at eminent domain legislative reform came about
as a reaction to the 2005 decision of the United States Supreme Court in Kelo v.
City of New London,5 where the Court, in a 5-4 ruling, upheld the use of eminent
domain for economic development, ruling that such development satisfies the
“public use” requirement of the Takings Clause of the Fifth Amendment to the
United States Constitution. Not unlike most states around the nation, Texas
responded promptly to Kelo, with Governor Perry amending his call in 2005 for a
special session on school finance by adding to the call proposed legislation to
address the effects of Kelo. Senate Bill 7 (which amended the Texas Government
1
Governor Perry’s press release and videotaped statements at the ceremonial signing of Senate
Bill 18, along with the videotaped statements of Senator Estes, Senator Duncan, Representative
Geren and Agricultural Commissioner Todd Staples, can be found at the Governor’s website at
http://governor.state.tx.us/news/press-release/16160/.
2
Id.
3
Id.
4
Id.
5
545 U.S. 469 (2005).
1
Code by adding a new Chapter 2206) went far to protect private property from
eminent domain for economic development purposes; however, it was a bill that
exempted many projects, including Governor Perry’s pet Trans-Texas Corridor and
the new Dallas Cowboys Stadium in Arlington.6
Not happy with the 2005 legislation that addressed the issue of eminent
domain (rather than a constitutional amendment to limit perceived eminent domain
abuses), the 2007 session of the Texas Legislature attempted to refine the
definition of public purpose by eliminating what many considered large loopholes
that permitted eminent domain for blighted areas. Consequently, House Bill 2006
and House Bill 3057 were introduced in the 2007 legislative session. Both bills
significantly narrowed the definition of “public use” and the procedures regarding
the condemnation of private property and, specifically, the condemnation of
blighted areas. House Bill 2006 would have limited local authority by providing
that a city identify each unit of real property in the city that has the characteristics
of blight. This would have been problematic since in almost every case, an area to
be redeveloped has one or two properties that do not meet the definition of
“blight,” but that should be acquired as part of the greater redevelopment effort.
Nevertheless, the restrictions in House Bill 2006 and House Bill 3057 would have
hampered the ability of cities to revitalize such deteriorated areas. While House
Bill 3057 did not make it to the Governor’s desk, House Bill 2006, which passed
both houses, was vetoed by Governor Perry in June 2005.
It is not surprising, therefore, that among the changes in law brought about
by Senate Bill 18, that Government Code Chapter 2206 continues to be amended to
reflect the pro-property rights and anti-Kelo sentiments found in the Texas
Legislature.7
While these items and more will be explored in this paper, in a nutshell,
Senate Bill 18 reforms the eminent domain laws for Texas cities by requiring that:
(1)
6
There be a public and record vote to initiate eminent domain
proceedings.
See Tex. Gov’t Code § 2206.001.
7
For a complete analysis of Kelo, the backlash it created throughout the Nation, and the Texas
response to Kelo, the author recommends an article by Robert F. Brown and Terrence S. Welch
entitled “Pushing the Limits of Eminent Domain,” presented at the 42nd Annual William W.
Gibson, Jr., Mortgage Lending Institute, sponsored by the University of Texas School of Law,
which article can be found at http://www.bhlaw.net/articles/.
2
(2)
Private property can be condemned only for public use, not private
use.
(3)
All entities with eminent domain authority must register with the
Comptroller by December 2012.
(4)
Condemning entities must make a bona fide offer in writing and, if
not, pay the landowner’s expenses and attorney’s fees.
(5)
Landowners will be compensated for damages from a loss of direct
access to their property. Landowners will receive relocation assistance
when forced to move off of their property.
(6)
Under certain conditions, landowners will have the right to repurchase
their condemned land at the original price (not market price) if it is
not used for the public use for which it was condemned within 10
years.
This purpose of this paper is to identify the significant changes to eminent
domain practice brought about by Senate Bill 18 and to, hopefully, provide some
practical advice to city attorneys that engage in condemnation work. Moreover,
this paper presumes that the reader has a basic familiarity of condemnation law as
it is not the author’s intent to provide an eminent domain overview or primer, but
rather to focus of the changes inflicted by Senate Bill 18.8
II.
Senate Bill 18 Changes Impacting Texas Cities
Senate Bill 18 (a copy of which is attached as Tab 1 in the Appendix to this
paper) made a number of significant changes to condemnation practice in Texas.
The new provisions, which became effective on September 1, 2011, and which
8
For a good overview of condemnation law, practice and procedures, the author recommends an
article by Zindia Thomas and Julian Grant of the Office of the Texas Attorney General entitled
“2012 Texas Eminent Domain Laws Made Easy, Answers to the Most Frequently Asked
Questions About Texas Eminent Domain Laws,” which article can be found at the following:
https://www.oag.state.tx.us/AG_Publications/pdfs/eminent_domain_easy.pdf.
3
apply to any condemnation proceeding in which the condemnation petition was
filed on or after September 1, 2011, are discussed below.9
A. Changes to Government Code Chapter 2206
1. “Public Use” Versus “Public Purpose”
Senate Bill 18 amended Government Code Section 2206.001 to clarify that a
taking of public property must be for a public use. The amendment to Section
2206.001(b) provided as follows:
b)
A governmental or private entity may not take private property
through the use of eminent domain if the taking:
(1)
confers a private benefit on a particular private party
through the use of the property;
(2)
is for a public use that is merely a pretext to confer a
private benefit on a particular private party; [or]
(3)
is for economic development purposes, unless the
economic development is a secondary purpose resulting
from municipal community development or municipal
urban renewal activities to eliminate an existing
affirmative harm on society from slum or blighted areas
under:
(4)
(A)
Chapter 373 or 374, Local Government Code,
other than an activity described by Section
373.002(b)(5), Local Government Code; or
(B)
Section 311.005(a)(1)(I), Tax Code; or
is not for a public use.10
9
While Senate Bill 18 contained provisions related to schools, pipeline carriers, and other
entities that possess eminent domain powers, this paper focuses on those issues that impact
Texas cities.
10
Tex. Gov’t Code § 2206.001(b).
4
Based on the author’s review of the legislative history behind Senate Bill 18,
it appears that there was concern over the use of the term “public use” versus
“public purpose.” The Fifth Amendment to the United States Constitution,
commonly referred to as the “Takings Clause,” prohibits the taking of private
property for public use without just compensation. Similarly, Section 17 of Article
I of the Texas Constitution prohibits a person’s property from being taken,
damaged, or destroyed for public use without adequate compensation, unless by
consent of that person.
Both the Fifth Amendment to the United States Constitution and Section 17,
Article I, of the Texas Constitution refer to “public use” in the context of the taking
of property. Prior to Senate Bill 18, however, there was no express language
banning takings not necessary for a public use. Concerns were raised that the
blurring of the terms “public use” and “public purpose” by the Legislature and the
courts somehow allowed condemnations of land to occur for a “public purpose,”
but for land that was not required for a “public use.” This was certainly the
position taken by the Texas Public Policy Foundation, which describes itself as a
non-profit, non-partisan research institute, whose stated mission is to “promote and
defend liberty, personal responsibility, and free enterprise in Texas by educating
and affecting policymakers and the Texas public policy debate with academically
sound research and outreach.”11
The Texas Public Policy Foundation, which supported Senate Bill 18,
expressed its concerns over the “public use” versus “public purpose” as follows:
According to the United States and Texas constitutions, eminent
domain can only be used for a public use. However, the Texas
Legislature and Texas courts have closely followed the national trend
of blurring the distinction between public use and public purpose. For
instance, Sec. 251.001 of the Texas Local Government Code states:
“When the governing body of a municipality considers it necessary,
the municipality may exercise the right of eminent domain for a
public purpose to acquire public or private property, whether located
inside or outside the municipality, for any of the following purposes.”
This confusion between public use and public purpose is what led the
Supreme Court in its Kelo decision to allow takings for the purposes
of increasing tax revenue and economic development, rather than
11
The reader can learn more about the Texas Public Policy Foundation at its website at
http://www.texaspolicy.com/index.php.
5
limiting takings to public uses like building public schools and roads.
This amendment simply inserts the constitutional term “public use” in
place of “public purpose” in the provisions in statute that authorize the
use of eminent domain for cities, counties and school districts. This is
the next step—after banning takings for economic development
purposes—to ensure that takings conform with the original vision of
public use as contained in the Texas and U.S. constitutions.12
Practical Pointer. Whether the difference between a taking for a “public purpose”
versus a taking for a “public use” is a meaningful one, either legally or factually,
remains to be seen. What is clear, however, is that Texas cities should invoke the
magic words “public use” when they condemn property and stay away from the
term “public purpose,” at least as a stand-alone concept.
Senate Bill 18 also amended Local Government Section 251.001 (regarding
city condemnation powers), Section 261.001 (regarding county condemnation
powers), Section 263.201 (regarding county condemnation of land for certain
water projects) and Section 273.002 (regarding city condemnation for certain
enumerated purposes) to remove the term “public purpose” and replace it with the
term “public use” throughout.
2. “Truth in Condemnation Procedures Act”
Senate Bill 18 created a new subchapter in Government Code Chapter 2206
entitled the “Truth in Condemnation Procedures Act.” Despite the somewhat
inflammatory title (which suggests that condemning authorities do not tell the truth
in condemnation matters), the actual substance of the Truth in Condemnation
Procedures Act addresses the procedures now required to initiate condemnation
proceedings. This new subchapter reads as follows:
12
See the Texas Public Policy Foundation’s April 2011 Senate Bill 18 Analysis at
http://www.texaspolicy.com/pdf/2011-04-PB12-BillAnalysis-SB18-Summary-Revised-bp.pdf.
6
SUBCHAPTER B. PROCEDURES REQUIRED TO INITIATE
EMINENT DOMAIN PROCEEDINGS
Sec. 2206.051. SHORT TITLE. This subchapter may be cited as the
Truth in Condemnation Procedures Act.
Sec. 2206.052.
APPLICABILITY. The procedures in this
subchapter apply only to the use of eminent domain under the laws of
this state by a governmental entity.
Sec. 2206.053. VOTE ON USE OF EMINENT DOMAIN.
(a)
(b)
(c)
Before a governmental entity initiates a condemnation
proceeding by filing a petition under Section 21.012, Property
Code, the governmental entity must:
(1)
authorize the initiation of the condemnation proceeding
at a public meeting by a record vote; and
(2)
include in the notice for the public meeting as
by Subchapter C, Chapter 551 [Open Meeting
addition to other information as required
subchapter, the consideration of the use of
domain to condemn property as an agenda item.
required
Act], in
by that
eminent
A single ordinance, resolution, or order may be adopted for all
units of property to be condemned if:
(1)
the motion required by Subsection (e) indicates that the
first record vote applies to all units of property to be
condemned; and
(2)
the minutes of the governmental entity reflect that the
first vote applies to all of those units.
If more than one member of the governing body objects to
adopting a single ordinance, resolution, or order by a record vote
for all units of property for which condemnation proceedings are
to be initiated, a separate record vote must be taken for each unit
of property.
7
13
(d)
For the purposes of Subsections (a) and (c), if two or more units
of real property are owned by the same person, the governmental
entity may treat those units of property as one unit of property.
(e)
The motion to adopt an ordinance, resolution, or order
authorizing the initiation of condemnation proceedings under
Chapter 21, Property Code, must be made in a form substantially
similar to the following:
“I move that the (name of
governmental entity) authorize the use of the power of eminent
domain to acquire (describe the property) for (describe the
public use).” The description of the property required by this
subsection is sufficient if the description of the location of and
interest in the property that the governmental entity seeks to
acquire is substantially similar to the description that is or could
properly be used in a petition to condemn the property under
Section 21.012, Property Code.
(f)
If a project for a public use described by Section 2206.001(c)(3)
will require a governmental entity to acquire multiple tracts or
units of property to construct facilities connecting one location
to another location, the governing body of the governmental
entity may adopt a single ordinance, resolution, or order by a
record vote that delegates the authority to initiate condemnation
proceedings to the chief administrative official of the
governmental entity.
(g)
An ordinance, resolution, or order adopted under Subsection (f)
is not required to identify specific properties that the
governmental entity will acquire. The ordinance, resolution, or
order must identify the general area to be covered by the project
or the general route that will be used by the governmental entity
for the project in a way that provides property owners in and
around the area or along the route reasonable notice that the
owners’ properties may be subject to condemnation proceedings
during the planning or construction of the project.13
Tex. Gov’t Code §§ 2206.051-2206.053.
8
3. Breaking Down the New Procedural Requirements
A.
Agenda Notice. In addition to the traditional open meetings notice
requirements for an agenda item, the law now requires that the agenda notice
specifically state that the city may consider using eminent domain to
condemn property.14
Practical Pointer. As a result, the typical practice of providing agenda
notice of an executive session to “discuss land acquisition” and upon
returning from executive session to “take appropriate action” will no longer
suffice. Now, the agenda notice should state, at a minimum, “take
appropriate action including consideration of the use of eminent domain to
condemn the property.”
B.
Record Vote Required. No condemnation suit may be filed before there is
a “record vote” by the city council to do so.15
Practical Pointer. While the law does not state what is required to
constitute a “record vote” on a motion to condemn property, the author
recommends that the minutes reflect and identify each person who voted for
the motion, who voted against motion and, if applicable, who abstained from
voting. As the clear intent of this law is to require transparency and
accountability, the safer practice is to record each council member’s vote,
rather than having minutes that simply state “the motion to condemn passed
by a vote of 3 to 2.”
C.
Language of the Approval Motion. The new law requires that the approval
motion to adopt an ordinance, resolution or order authorizing condemnation
state the following phrase, or a phrase that is substantially similar to the
following phrase: “I move that the (name of governmental entity) authorize
the use of the power of eminent domain to acquire (describe the property)
for (describe the public use).”16 Once again, the purpose here is
transparency.
14
Tex. Gov’t Code §§ 2206.053(a)(2).
15
Tex. Gov’t Code §§ 2206.053(a)(1).
16
Tex. Gov’t Code §§ 2206.053(e).
9
Practical Pointer. While not expressly stated as such, it is clear that an
actual “ordinance, resolution or order” is now required to authorize
condemnation proceedings. So, if a city’s typical practice was to simply vote
on an oral motion to condemn, the approval of which was reflected only in
the minutes, that practice will need to be changed to comply with the new
law. A sample post-Senate Bill 18 condemnation resolution is attached as
Tab 2 in the Appendix to this paper.
D.
Sufficiency of the Property Description in the Approval Motion. The
new law requires that the property description used in the condemnation
approval motion will be “sufficient if the description of the location of and
interest in the property that the governmental entity seeks to acquire is
substantially similar to the description that is or could properly be used in a
petition to condemn the property under Section 21.012, Property Code.”17
The Texas Property Code requires that a condemnation petition “describe
the property to be condemned.”18 While the statute is silent as to how a
condemning authority must describe property, case law has provided
guidance. The sufficiency of a condemnation petition’s description of the
property to be condemned is tested by the standards used for adequacy of
description in a deed.19
Practical Pointer. While a metes and bounds description is not required in
the condemnation motion, the property does need to be described with
enough certainty and specificity that a surveyor, using the description, could
locate the described property on the ground.
17
Tex. Gov’t Code §§ 2206.053(d).
18
Tex. Prop. Code. § 21.012(b)(1).
19
Lin v. Houston Cmty. Coll. Sys., 948 S.W.2d 328, 332 (Tex.App.-Amarillo 1997, pet. denied).
In Coastal Indus. Water Auth. v. Celanese Corp., 592 S.W.2d 597, 600 (Tex.1979), the Texas
Supreme Court, quoting Wooten v. State, 142 Tex. 238, 177 S.W.2d 56, 57 (1944), noted “[t]he
certainty required in the description of the land in a condemnation proceeding ‘is of the same
nature as that required in conveyances of land, so that a surveyor could go upon the land and
mark out the land designated.’ ” Further, it is well established that if the description is
sufficiently certain that a surveyor could locate the tract, the fact that it might contain “a false
and contradictory element of description is harmless.” Boone v. Panola County, 880 S.W.2d
195, 196 (Tex.App.-Tyler 1994, no writ), quoting Roberts v. County of Robertson, 48 S.W.2d
737, 738 (Tex.Civ.App.-Waco 1932, writ ref’d). See also Lin, 948 S.W.2d at 332.
10
E.
Combined or Single Motion to Condemn? When a city is condemning a
single tract or parcel of land for a water tower, fire station, lift station or
other public use, the new law does not present any particular problem on the
motion to condemn. When a city seeks to condemn multiple tracts for a road,
utility lines, drainage easements and the like, however, further review of the
new law is warranted. What Senate Bill 18 provides is that “a single
ordinance, resolution or order may be adopted for all units of property to be
condemned” if the condemnation approval motion “indicates that the first
record vote applies to all units of property to be condemned,” and the
minutes so reflect.20 That part seems easy enough – as long as you describe
and include all of the land needed for the condemnation in your motion, you
do not need to have separate motions or condemnation resolutions for each
individual property to be condemned.
If, however, for whatever reason, a council member objects to the single
motion for all included properties, the new law requires that a separate
record vote be taken for each property sought to be condemned, which
would result in separate motions and separate condemnation resolutions for
each property.21
Practical Pointer. If you believe that there is a possibility that a council
member might object and thus require the city council to consider separate
motions and resolutions for the acquisitions, you may want to consider
having separate resolutions prepared for each property to be used at your
meeting if needed. Otherwise, you may have to table a condemnation item
for which staff has prepared only one condemnation resolution for all
properties to be condemned.
F.
Water, Waste Water, Flood Control and Drainage Projects. Under
Senate Bill 18, water, waste water, flood control and drainage projects are
treated differently than other public uses in two ways.
First, the city is not required to identify the specific parcels or tracts of
properties that the city will condemn. The city is allowed to adopt a
condemnation ordinance, resolution or order that will “identify the general
area to be covered by the project or the general route that will be used by the
20
Tex. Gov’t Code §§ 2206.053(b).
21
Tex. Gov’t Code §§ 2206.053(c).
11
governmental entity for the project in a way that provides property owners in
and around the area or along the route reasonable notice that the owners’
properties may be subject to condemnation proceedings during the planning
or construction of the project.”22
Practical Pointer. For these covered projects, a city may use a route map or
other general diagram that gives fair notice that an owner’s property may be
condemned for a water line, sewer line, flowage easement or drainage
easement, even if the precise location of the planned public improvement
has not been determined.
Second, Senate Bill 18 allows the city, for those projects which require
multiple tracts of land for water lines, sewer lines, flowage easements and
drainage easements, to adopt one ordinance or resolution for the project that
“delegates the authority to initiate condemnation proceedings to the chief
administrative official of the governmental entity.”23
Practical Pointer. Utilization of this provision of the new law allows the
city manager, and presumably his/her designee, to authorize condemnations
once the precise metes and bounds parcels needed for the project are
determined by the engineers without having to go back to city council again
for additional authorization. This process should help promote efficiency
and potentially de-politicize the land acquisition process.
G.
Road Projects. For road projects and any other projects that require the
acquisition of multiple tracts of land that are not “water, waste water, flood
control and drainage projects,” the city will have to identify each separate
property interest to be acquired and describe such interests with enough
certainty and specificity that a surveyor, using the description, could locate
the described property on the ground. Also, the authorization for
condemnation for these types of projects cannot be delegated.
Practical Pointer. For road condemnations, the requirement that the precise
road layout be known in order to institute the condemnation process can be
difficult sometimes. While a city certainly knows where the road is going to
go, many times the fine tuning of the exact road limits is subject to further
22
Tex. Gov’t Code §§ 2206.053(g).
23
Tex. Gov’t Code §§ 2206.053(f).
12
engineering review, particularly the need for slope easements, drainage
easements, visibility clips and temporary construction easements. While a
road route map can still be used as the framework for the condemnation
resolution, at a minimum, the resolution will need to identify each owner of
property over which the road (and all associated easements) may be located.
4. Condemnation Sunset Provisions
One of the stated legislative concerns over pre-Senate Bill 18 condemnation
practice was there was uncertainty as to what entities possessed the power to
condemn. In response, Senate Bill 18 created Government Code Section 2206.101,
which requires that all entities, whether they be governmental or private, that
possess the power of eminent domain to identify each provision of law that grants
such power in a letter to the State Comptroller. The letter must be submitted by
December 31, 2012. Failure to submit the required letter results in the expiration of
that entity’s condemnation power.24
Practice Pointer. While TML submitted to the Comptroller’s office a
submission for all general law and home rule cities in TML’s database in the Fall
of 2011, the author recommends that each city send in its own form by year end in
an abundance of caution. The State Comptroller has prepared a form that cities can
use for the Senate Bill 18 submission.25
B. Changes to Property Code Chapter 21
Property Code Chapter 21 governs condemnation procedures. By way of an
overview, the process of land condemnation in Texas involves several steps. If the
condemnor and landowner cannot agree on the value of the condemned property,
the condemnor must file a petition in condemnation in either the district court or
county court at law.26 The trial court will then appoint three special commissioners
who hold an administrative hearing and file in the trial court an award that reflects
the special commissioners’ determination of the value of the condemned land.27
The condemnor must pay the amount of the award to the landowner or deposit that
24
Tex. Gov’t Code §§ 2206.101.
25
The form can be found at http://window.state.tx.us/sb18compliance/.
26
Tex. Prop. Code § 21.003.
27
Tex. Prop. Code §§ 21.014, 21.015, 21.018.
13
amount in the registry of the trial court. If either party is dissatisfied with the
award, the party may file objections with the trial court.28 After citing the adverse
party, the trial court then tries the case in the same manner as other civil cases.29
Senate Bill 18, while not changing this basic process, has created additional
obligations on the condemning authority as it works through this process. Below,
we will look at these changes and compare them to the old law where applicable.
1. Disclosure of Appraisal Reports
At the time of the initial offer to purchase or lease land, the city must send to
the owner by certified mail all appraisals of the property possessed by the city that
have been prepared within 10 years prior to the offer.30 Under the old law, the only
appraisal the city was required to disclose was the one “used in determining the
final offer.” In contrast, the property owner is only required to disclose the current
appraisal upon which he relies in determining his opinion of value, which was the
law before Senate Bill 18.31 The landowner’s disclosure time, however, has been
changed. Under the old law, a landowner was required to provide the city with his
appraisal at least 10 days before the special commissioners’ hearings; under the
new law, that time period has been shortened to 3 business days before the
hearing.32
2. Prohibition of Confidentiality of Acquisition Offer or Agreement
Senate Bill 18 provides that a city may not include a confidentiality
provision in any offer or purchase agreement; it further requires that the city
inform the owner of his right to discuss the offer or agreement with others, or to
keep the offer or agreement confidential, subject to the city’s disclosure obligations
under the Public Information Act.33 Typical language in a post-Senate Bill 18 offer
28
Tex. Prop. Code § 21.018(a).
29
Tex. Prop. Code § 21.018(b).
30
Tex. Prop. Code § 21.0111(a).
31
Tex. Prop. Code § 21.0111(b).
32
Tex. Prop. Code § 21.0111(b).
33
Tex. Prop. Code § 21.0111(c).
14
letter might read as follows: “You have the right to discuss with others any offer or
agreement regarding the City’s acquisition of the subject property, or you may (but
are not required to) keep the offer or agreement confidential from others, subject to
the provisions of Chapter 552, Government Code (the Public Information Act) as it
may apply to the City.” The author recommends that this, or substantially similar,
language be included in all offer letters, from the initial offer letter to the final
offer, and any offer letters that might fall between. A sample post-Senate Bill 18
offer letter is attached as Tab 3 in the Appendix to this paper.
3. Bona Fide Offer Required
While case law has always required that (1) a city plead that the parties were
unable to agree on the value of the land to be acquired and the damages, if any, to
the remainder, and (2) a good faith offer be made as a prerequisite to initiate
condemnation proceedings, case law has been somewhat muddled as to what
constitutes a good faith offer.34 Senate Bill 18 clarifies this obligation by making it
statutorily required in Property Code Section 21.0113, and by defining what
constitutes a bona fide offer.
This new section provides as follows:
Sec. 21.0113. BONA FIDE OFFER REQUIRED.
(a)
An entity with eminent domain authority that wants to acquire
real property for a public use must make a bona fide offer to
acquire the property from the property owner voluntarily.
(b)
An entity with eminent domain authority has made a bona fide
offer if:
(1)
an initial offer is made in writing to a property owner;
(2)
a final offer is made in writing to the property owner;
34
See Hubanek v. San Jacinto Gas Transmission Co., 141 S.W.3d 172 (Tex. 2004), for a
discussion of this requirement and the various treatments provided it by different courts.
15
(3)
the final offer is made on or after the 30th day after the
date on which the entity makes a written initial offer to
the property owner;
(4)
before making a final offer, the entity obtains a written
appraisal from a certified appraiser of the value of the
property being acquired and the damages, if any, to any
of the property owner’s remaining property;
(5)
the final offer is equal to or greater than the amount of
the written appraisal obtained by the entity;
(6)
the following items are included with the final offer or
have been previously provided to the owner by the entity:
(7)
(A)
a copy of the written appraisal;
(B)
a copy of the deed, easement, or other instrument
conveying the property sought to be acquired; and
(C)
the landowner's bill of rights statement prescribed
by Section 21.0112; and
the entity provides the property owner with at least 14
days to respond to the final offer and the property owner
does not agree to the terms of the final offer within that
period.35
4. Some Practical Bona Fide Offer Requirement Considerations
A few items are worth pointing out and discussing when contrasting the new
law versus the authorized practice under the old law.
35
Tex. Prop Code § 21.0113.
16
While the initial offer can be based on something other than an appraisal,
the final offer must be based on a written appraisal from a certified
appraiser.36 This means that even for small, extremely low value corner clips,
visibility clips, and other very small takings, that an appraisal will need to be done.
The practice of using tax roll values by city staff to determine the offer amount for
such low value takings, or using windshield appraisals,37 while economically
prudent, is no longer allowed.
The final offer letter must include the deed, easement or other
conveyance instrument.38 This provides clarity over an offer letter that requests a
slope easement, drainage easement, or other easement without specifying the rights
encumbered by the easement. The final offer letter must provide a copy of the
Landowner’s Bill of Rights (even if previously provided).39
The final offer letter must provide the owner at least 14 days to respond
before the city may file suit.40 The old law did not specify a time period by which
the city had to wait before filing suit. While most cities, as a matter of policy,
usually provided 10 to 14 days as a courtesy for a response, the author has seen,
and been personally involved in, condemnations that were filed within a few days
of the final offer letter having been served.
If the trial court determines that the city did not make the required bona
fide offer prior to instituting a condemnation suit, the court shall abate, but
not dismiss, the suit and shall order the city to make a bona fide order to the
landowner and shall order the city to pay “any reasonable attorney’s fees and other
professional expenses incurred by the property owner that are directly related to
the violation.”41
36
Tex. Prop Code § 21.0113(b)(5).
37
A “windshield appraisal” is one where the appraiser drives by the property, eyeballs it through
the window, drives on and then prepares an appraisal.
38
Tex. Prop Code § 21.0113(b)(6)(B).
39
Tex. Prop Code § 21.0113(b)(6)(C).
40
Tex. Prop Code § 21.0113(b)(7).
41
Tex. Prop Code § 21.047(d).
17
5. Condemnation Petition Changes
Texas Property Code Section 21.012, regarding the requirements of a
condemnation petition, has been amended to now require that a city state “with
specificity” the public “use” (vs. the public “purpose”) for which the city
intends to acquire the property.42
The law also requires that the city plead that it has made the required
bona fide offer.43 The following language will suffice: “The City, through its duly
authorized agent, made a bona fide offer to acquire the required property interests
from the fee simple owner of the property voluntarily as provided by Texas
Property Code Section 21.0113.”
A copy of the petition must be sent to the property owner by certified
mail. The old law only required the service of the petition with the notice of the
special commissioners’ hearing. While many cities routinely provided courtesy
copies of condemnation petitions to landowners, as well as all other defendants
(lien holders, mortgage holders, trustees, etc.), Senate Bill 18 requires that this now
be done as a statutory requirement.
44
Senate Bill 18 requires that only the property owner be provided with a copy
of the suit.45 Given that prudent practice dictates that a lis pendens be filed on the
property contemporaneously with, or immediately after, the filing of the suit, and
given that the law requires that all defendants to the condemnation suit be provided
a copy of the lis pendens,46 the safest approach is to provide all parties to the
condemnation proceeding with a copy of the suit by mail. One approach would be
to simply provide the lis pendens and condemnation suit in the same transmittal
letter to the landowner and other defendants.
42
Tex. Prop Code § 21.012(b)(2).
43
Tex. Prop Code § 21.012(b)(6).
44
Tex. Prop Code § 21.012(c).
45
Tex. Prop Code § 21.012(c).
46
Tex. Prop Code § 12.007(d).
18
6. Commissioners’ Hearing Changes
Senate Bill 18 requires the court to give each party “a reasonable period to
strike one of the three commissioners appointed by the judge.”47 The law fails to
provide guidance, however, as to what is considered a reasonable period of time
and leaves this to the discretion of the trial court judge. Based on the author’s
observations, the courts in the DFW area appear to be giving the parties between 7
to 14 days to strike a commissioner. While the old law required a party to have a
reason to strike a commissioner (i.e., for cause), the new law gives each party one
preemptory strike without cause.
Additionally, while the old law did not place any limits on how quickly
appointed special commissioners could convene to hear a condemnation case, the
new law requires that the special commissioners not convene a hearing “before
the 20th day after the date the special commissioners were appointed.”48 This
arguably means that a city must wait at least 20 days before the commissioners can
even sign an order setting the hearing, presumably to allow the filing a motion to
strike a commissioner under the “reasonable period” to strike provision of Senate
Bill 18.
Senate Bill 18 also requires that notice of the special commissioners’
hearing must be served on a party not later than 20th (formerly the 11th) day
before the day set for the hearing.49 This provision, when combined with the
requirement of waiting at least 14 days after a final offer to file suit,50 waiting a
“reasonable period” to allow the landowner to strike a commissioner,51 and waiting
at least 20 days before scheduling a hearing date after the commissioners are
appointed,52 adds around 40 to 50 days to the process allowed under the old law. A
timeline of dates under Senate Bill 18 is attached as Tab 4 in the Appendix to this
paper.
47
Tex. Prop Code § 21.014(a).
48
Tex. Prop. Code § 21.015(a).
49
Tex. Prop. Code § 21.016(b).
50
Tex. Prop Code § 21.0113(b)(7).
51
Tex. Prop Code § 21.014(a).
52
Tex. Prop. Code § 21.015(a).
19
7. Disclosure of Right to Repurchase
Property Code Section 21.023 has been amended as follows:
Sec. 21.023. DISCLOSURE OF INFORMATION REQUIRED
AT TIME OF ACQUISITION.
An [A governmental] entity with eminent domain authority shall
disclose in writing to the property owner, at the time of acquisition of
the property through eminent domain, that:
(1)
(2)
the owner or the owner’s heirs, successors, or assigns
may be [are] entitled to:
(A)
repurchase the property under Subchapter E [if the
public use for which the property was acquired
through eminent domain is canceled before the
10th anniversary of the date of acquisition]; or
(B)
request from the entity certain information relating
to the use of the property and any actual progress
made toward that use; and
the repurchase price is the price paid to the owner by the
entity at the time the entity acquired the property through
eminent domain [fair market value of the property at the
time the public use was canceled].53
This change in the law gives the owner of the property a right to “progress
reports” on the status of whether or not the property condemned is being used for
the public use for which it was condemned.54 It also changes the law to require that
the repurchase price is the price paid for the land by the city through
condemnation.55 This change apparently was in response to concerns that a
condemning authority could condemn land, sit on it for years and let the market
value diminish, and then sell it back to the prior owner at the diminished value.
53
Tex. Prop. Code § 21.023.
54
Tex. Prop. Code § 21.023(1)(b).
55
Tex. Prop. Code § 21.023(2).
20
The Legislature’s apparent concern, which resulted in the “buy-back”
provisions of Senate Bill 18, was that under the old law, a condemning authority
could condemn land in fee simple for a public purpose and then use the land for
just about any purpose that that it wanted since the law did not require the
condemning authority to use the land for the purpose for which it was taken. While
the old law did allow for the repurchase of property by the original owner if the
public use for which the property was taken was cancelled, it required the land sale
to occur at the current market value, not the price paid to the former landowner.
Senate Bill 18 requires the land to be resold to the original owner for the price paid
at condemnation.56
The new law also states that the right to repurchase notice must be given
“at the time of acquisition.”57 Typically, this is done either in the condemnation
judgment or by separate notice at the time the condemnation judgment is entered.
8. Right to Repurchase
Senate Bill 18 essentially rewrote Property Code Section 21.101 to provide
new requirements on the right to repurchase land. That section now reads as
follows:
Sec. 21.101. RIGHT OF REPURCHASE.
(a)
A person from whom a real property interest is acquired by an
entity through eminent domain for a public use, or that person’s
heirs, successors, or assigns, is entitled to repurchase the
property as provided by this subchapter if:
(1)
the public use for which the property was acquired
through eminent domain is canceled before the property
is used for that public use;
(2)
no actual progress is made toward the public use for
which the property was acquired between the date of
acquisition and the 10th anniversary of that date; or
56
Tex. Prop. Code § 21.023(2).
57
Tex. Prop. Code § 21.023.
21
(3)
(b)
the property becomes unnecessary for the public use for
which the property was acquired, or a substantially
similar public use, before the 10th anniversary of the date
of acquisition.
In this section, “actual progress” means the completion of two
or more of the following actions:
(1)
the performance of a significant amount of labor to
develop the property or other property acquired for the
same public use project for which the property owner’s
property was acquired;
(2)
the provision of a significant amount of materials to
develop the property or other property acquired for the
same public use project for which the property owner’s
property was acquired;
(3)
the hiring of and performance of a significant amount of
work by an architect, engineer, or surveyor to prepare a
plan or plat that includes the property or other property
acquired for the same public use project for which the
property owner’s property was acquired;
(4)
application for state or federal funds to develop the
property or other property acquired for the same public
use project for which the property owner’s property was
acquired;
(5)
application for a state or federal permit to develop the
property or other property acquired for the same public
use project for which the property owner’s property was
acquired;
(6)
the acquisition of a tract or parcel of real property
adjacent to the property for the same public use project
for which the owner’s property was acquired; or
(7)
for a governmental entity, the adoption by a majority of
the entity’s governing body at a public hearing of a
22
development plan for a public use project that indicates
that the entity will not complete more than one action
described by Subdivisions (1)-(6) before the 10th
anniversary of the date of acquisition of the property.
(c)
A district court may determine all issues in any suit regarding
the repurchase of a real property interest acquired through
eminent domain by the former property owner or the owner’s
heirs, successors, or assigns.58
In essence, this new provision addresses the Legislature’s concerns of
“land banking” by condemning authorities of land for long-range land planning
through land speculation, where a government entity sits on property for years
before beginning construction of the project for which the property was taken. For
example, a school board could take land for a school that the board intends to build
10 to 15 years down the road as the community expands. While Senate Bill 18
does not prohibit such laudable long-term planning, it does prohibit the practice of
taking land at today’s prices when the land will not be uses until much, much later.
Senate Bill 18 also requires that land acquired for a particular public use
be used for that particularly designated use within 10 years, or at least some
substantial progress towards the use must be shown, or the prior owner has the
right to repurchase the land.59
Amended Property Code Section 21.102 requires that a city has 180 days
after it determines that a former owner has a repurchase right to so notify
said prior owner.60 The specifics of the required notice are set forth in that
section.
New Property Code Sections 21.1021 and 21.1022 address, respectively, the
procedures regarding requests for information regarding condemned
property after 10 years, and the creation of a one-year limitations period on the
right to repurchase once the required repurchase notice has been given.61
58
Tex. Prop. Code § 21.101.
59
Tex. Prop. Code § 21.101.
60
Tex. Prop. Code § 21.102.
61
Tex. Prop. Code §§ 21.1021, 21.1022.
23
9. Relocation Assistance Program
Prior to Senate Bill 18, the relocation assistance program found in Property
Code Section 21.046 had been required for the State and its agencies, but was
discretionary for cities and other political subdivisions. Under the new language in
Senate Bill 18, cities are required to provide a relocation assistance program for the
displacement of persons or entities due to an acquisition of real property.
New Property Code Section 21.046 provides as follows:
Sec. 21.046. RELOCATION ASSISTANCE PROGRAM.
(a)
A department, agency, instrumentality, or political subdivision
of this state shall provide a relocation advisory service for an
individual, a family, a business concern, a farming or ranching
operation, or a nonprofit organization that is compatible with
the Federal Uniform Relocation Assistance and Real Property
Acquisition Policies Act of 1970, 42 U.S.C.A. 4601, et seq.
(b)
This state or a political subdivision of this state shall, as a cost
of acquiring real property, pay moving expenses and rental
supplements, make relocation payments, provide financial
assistance to acquire replacement housing, and compensate for
expenses incidental to the transfer of the property if an
individual, a family, the personal property of a business, a
farming or ranching operation, or a nonprofit organization is
displaced in connection with the acquisition.
(c)
A department, agency, instrumentality, or political subdivision
of this state that initiates a program under Subsection (b) shall
adopt rules relating to the administration of the program.
(d)
Neither this state nor a political subdivision of this state may
authorize expenditures under Subsection (b) that exceed
payments authorized under the Federal Uniform Relocation
Assistance and Real Property Acquisition Policies Act of 1970,
42 U.S.C.A. 4601, et seq.
24
(e)
If a person moves or discontinues the person’s business, moves
personal property, or moves from the person’s dwelling as a
direct result of code enforcement, rehabilitation, or a demolition
program, the person is considered to be displaced because of
the acquisition of real property.62
The basic expenditure limits under the Federal Uniform Relocation
Assistance and Real Property Acquisition Policies Act of 1970
(“FURARPAPA”) are found at 42 USC §§ 4622-4626. FURARPAPA63 provides
for residential displacees reimbursement for reasonable moving costs up to a 50mile distance, purchase supplements of up to $22,500 or rental assistance payments
up to $5,250 per month for 42-months. Businesses, farms and nonprofit
organizations displaced by condemnation may be reimbursed on the basis of actual
reasonable moving costs and related expenses or, under certain circumstances, a
fixed payment of up to $20,000.64
The relocation assistance program is separate from the actual
condemnation suit, however, and it is not an issue for the special
commissioners. Persons seeking relocation assistance would have the burden to
show eligibility. Any unresolved disputes over eligibility assistance would need to
be brought by a lawsuit filed by the expense reimbursement claimant.65
62
Tex. Prop Code § 21.046.
63
No, this is not a Hawaiian delicacy.
64
For a good overview of relocation expenses limits, plus the implementation of a relocation
assistance program, the reader is referred to TxDOT’s Relocation Assistance Handbook, which
can be found at the following website address: http://ftp.dot.state.tx.us/pub/txdotinfo/row/booklet_15.636.pdf.
65
Senate Bill 18’s relocation assistance program applies not only to properties acquired by
condemnation, but to every “acquisition” of property, which is the term used in Property Code
Section 21.046. In fact, Section 21.046(e) expressly states that “[i]f a person moves or
discontinues the person’s business, moves personal property, or moves from the person’s
dwelling as a direct result of code enforcement, rehabilitation, or a demolition program, the
person is considered to be displaced because of the acquisition of real property.” Thus, Senate
Bill 18 impacts city functions that go way beyond just condemnation.
25
10. Change of Access Impairment Compensability Standard
Senate Bill 18 amended Property Code Section 42.042, regarding the
assessment of damages, by changing subsection (d) as follows:
(d)
In estimating injury or benefit under Subsection (c), the special
commissioners shall consider an injury or benefit that is
peculiar to the property owner and that relates to the property
owner’s ownership, use, or enjoyment of the particular parcel of
real property, including a material impairment of direct access
on or off the remaining property that affects the market value of
the remaining property, but they may not consider an injury or
benefit that the property owner experiences in common with the
general community, including circuity of travel and diversion of
traffic. In this subsection, “direct access” means ingress and
egress on or off a public road, street, or highway at a location
where the remaining property adjoins that road, street, or
highway.66
The prior law regarding what constituted “material and substantial
impairment of access” was defined with a degree of certainty by the courts.67 There
is no legal authority of which the author could find, however, that defines or even
discusses the term “material impairment of direct access” as used in Senate Bill 18.
While the prior standard, as established by case law, focused on access to the entire
remainder tract and asked whether there was still “reasonable access” to the
remainder after the city’s restriction of access, the new standard focuses on direct
access to the property from the road system. The new operative factors, which have
yet to be opined on by the courts, are whether the impairment to “direct access”
66
Tex. Prop. Code § 21.042(d).
67
See, e.g., City of Austin v. Avenue Corp., 704 S.W.2d 11, 13 (Tex. 1986) (“[I]n order to show a
material and substantial interference with access to one’s property, it is necessary to show that
there has been a total but temporary restriction of access; or a partial but permanent restriction of
access; or a temporary limited restriction of access brought about by an illegal activity or one
that is negligently performed or unduly delayed.”); State v. Heal, 917 S.W.2d 6, 9-10 (Tex.
1996) (“[A] landowner is entitled to compensation when a public improvement destroys all
reasonable access, thereby damaging the property. [Also,] no right to compensation extends to a
property owner who has reasonable access to his property after the construction of the public
improvement because the benefits of private ownership have been preserved.”).
26
(ingress and egress on and off the remaining property) is “material” and, if so,
whether it “affects the market value of the remaining property”.
Practical Pointer. Consider instructing your appraiser on damages for impairment
of access. While under the old law, access to a secondary road would typically
defeat a claim of material denial of access, even if direct access to the primary road
was taken, such a finding may not prevent a finding of material impairment of
direct access under Senate Bill 18. Each case, of course, will depend on its specific
facts. A suggested appraisal instruction, patterned in large part on TxDOT’s
current appraisal instructions, is attached as Tab 5 in the Appendix to this paper.
III.
Closing Thoughts About Senate Bill 18
Whether Senate Bill 18 will satisfy, or simply temporarily satiate, those
special interests that seek to effectively erode eminent domain powers, remains to
be seen as the impacts of this bill are implemented over time. What is crystal-clear
right now, however, is that land acquisition for Texas cities will take more time,
involve more risk, and cost more. City Attorneys will need to remain diligent to
comply with the law’s new requirements as the new legal landscape is filled with
landmines, booby-traps and quicksand designed to impede, if not totally derail,
legitimate condemnation efforts.
27
APPENDIX
Tab
Item
1
Senate Bill 18
2
Sample Post-Senate Bill 18 Condemnation
Resolution
3
Sample post-Senate Bill 18 Offer Letter
4
Post-Senate Bill 18 Timeline
5
Post-Senate Bill 18 Suggested Appraisal
Guidance Memo on Damages for Impairment of
Access
28
TAB “1”
S.B. No. 18
AN ACT
relating to the use of eminent domain authority.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1.
Subsection (a), Section 11.155, Education Code, is
amended to read as follows:
(a)
An independent school district may, by the exercise of
the right of eminent domain, acquire the fee simple title to real
property [for the purpose of securing sites] on which to construct
school buildings or for any other public use [purpose] necessary
for the district.
SECTION 2.
Chapter 2206, Government Code, is amended to read
as follows:
CHAPTER 2206.
SUBCHAPTER A.
[LIMITATIONS ON USE OF] EMINENT DOMAIN
LIMITATIONS ON PURPOSE AND USE OF PROPERTY
Page - 1 -
S.B. No. 18
ACQUIRED THROUGH EMINENT DOMAIN
Sec. 2206.001.
PARTIES
OR
ECONOMIC
LIMITATION
ON
DEVELOPMENT
EMINENT
PURPOSES.
DOMAIN
FOR
PRIVATE
(a)
This
section
applies to the use of eminent domain under the laws of this state,
including a local or special law, by any governmental or private
entity, including:
(1)
a state agency, including an institution of higher
education as defined by Section 61.003, Education Code;
(2)
a political subdivision of this state; or
(3)
a corporation created by a governmental entity to
act on behalf of the entity.
(b)
A governmental or private entity may not take private
property through the use of eminent domain if the taking:
(1)
confers a private benefit on a particular private
party through the use of the property;
(2)
is for a public use that is merely a pretext to
confer a private benefit on a particular private party; [or]
(3)
is for economic development purposes, unless the
Page -2 -
economic
development
municipal
community
is
a
secondary
development
or
purpose
municipal
S.B. No. 18
resulting from
urban
renewal
activities to eliminate an existing affirmative harm on society
from slum or blighted areas under:
(A)
Chapter 373 or 374, Local Government Code,
other than an activity described by Section 373.002(b)(5), Local
Government Code; or
(B)
(4)
(c)
Section 311.005(a)(1)(I), Tax Code; or
is not for a public use.
This section does not affect the authority of an entity
authorized by law to take private property through the use of
eminent domain for:
(1)
transportation projects, including, but not limited
to, railroads, airports, or public roads or highways;
(2)
entities authorized under Section 59, Article XVI,
Texas Constitution, including:
(A)
port authorities;
(B)
navigation districts; and
Page -3 -
(C)
S.B. No. 18
any other conservation or reclamation districts
that act as ports;
(3)
water
supply,
wastewater,
flood
control,
and
drainage projects;
(4)
public buildings, hospitals, and parks;
(5)
the provision of utility services;
(6)
a sports and community venue project approved by
voters at an election held on or before December 1, 2005, under
Chapter 334 or 335, Local Government Code;
(7)
the operations of:
(A)
a common carrier pipeline [subject to Chapter
111, Natural Resources Code, and Section B(3)(b), Article 2.01,
Texas Business Corporation Act]; or
(B)
an energy transporter, as that term is defined
by Section 186.051, Utilities Code;
(8)
a purpose authorized by Chapter 181, Utilities Code;
(9)
underground storage operations subject to Chapter
91, Natural Resources Code;
Page -4 -
S.B. No. 18
(10)
a waste disposal project; or
(11)
a library, museum, or related facility and any
infrastructure related to the facility.
(d)
This
section
does
not
affect
the
authority
of
a
governmental entity to condemn a leasehold estate on property owned
by the governmental entity.
(e)
The determination by the governmental or private entity
proposing to take the property that the taking does not involve an
act or circumstance prohibited by Subsection (b) does not create a
presumption with respect to whether the taking involves that act or
circumstance.
Sec. 2206.002.
LIMITATIONS ON EASEMENTS.
(a)
This section
applies only to an easement acquired by an entity for the purpose
of a pipeline to be used for oil or gas exploration or production
activities.
(b)
A property owner whose property is acquired through the
use of eminent domain under Chapter 21, Property Code, for the
purpose of creating an easement through that owner's property may
Page -5 -
S.B. No. 18
construct streets or roads, including gravel, asphalt, or concrete
streets or roads, at any locations above the easement that the
property owner chooses.
(c)
The portion of a street or road constructed under this
section that is within the area covered by the easement:
(1)
must cross the easement at or near 90 degrees; and
(2)
may not:
(A)
exceed 40 feet in width;
(B)
cause a violation of any applicable pipeline
(C)
interfere with the operation and maintenance of
regulation; or
any pipeline.
(d)
At least 30 days before the date on which construction of
an asphalt or concrete street or road that will be located wholly
or partly in an area covered by an easement used for a pipeline is
scheduled to begin, the property owner must submit plans for the
proposed construction to the owner of the easement.
(e)
Notwithstanding
the
provisions
Page -6 -
of
this
section,
a
S.B. No. 18
property owner and the owner of the easement may agree to terms
other than those stated in Subsection (c).
SUBCHAPTER B.
PROCEDURES REQUIRED TO INITIATE
EMINENT DOMAIN PROCEEDINGS
Sec. 2206.051.
SHORT TITLE.
This subchapter may be cited as
the Truth in Condemnation Procedures Act.
Sec. 2206.052.
APPLICABILITY.
The
procedures
in
this
subchapter apply only to the use of eminent domain under the laws
of this state by a governmental entity.
Sec. 2206.053.
VOTE ON USE OF EMINENT DOMAIN.
(a)
Before a
governmental entity initiates a condemnation proceeding by filing a
petition under Section 21.012, Property Code, the governmental
entity must:
(1)
authorize
the
initiation
of
the
condemnation
proceeding at a public meeting by a record vote; and
(2)
required
by
include in the notice for the public meeting as
Subchapter
C,
Chapter
551,
in
addition
to
other
information as required by that subchapter, the consideration of
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the use of eminent domain to condemn property as an agenda item.
(b)
A single ordinance, resolution, or order may be adopted
for all units of property to be condemned if:
(1)
the motion required by Subsection (e) indicates that
the first record vote applies to all units of property to be
condemned; and
(2)
the minutes of the governmental entity reflect that
the first vote applies to all of those units.
(c)
If more than one member of the governing body objects to
adopting a single ordinance, resolution, or order by a record vote
for all units of property for which condemnation proceedings are to
be initiated, a separate record vote must be taken for each unit of
property.
(d)
For the purposes of Subsections (a) and (c), if two or
more units of real property are owned by the same person, the
governmental entity may treat those units of property as one unit
of property.
(e)
The motion to adopt an ordinance, resolution, or order
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authorizing
the
initiation
of
condemnation
S.B. No. 18
proceedings under
Chapter 21, Property Code, must be made in a form substantially
similar to the following:
"I move that the (name of governmental
entity) authorize the use of the power of eminent domain to acquire
(describe the property) for (describe the public use)."
description
of
the
property
required
by
this
subsection
The
is
sufficient if the description of the location of and interest in
the property that the governmental entity seeks to acquire is
substantially similar to the description that is or could properly
be used in a petition to condemn the property under Section 21.012,
Property Code.
(f)
If a project for a public use described by Section
2206.001(c)(3)
will
require
a
governmental
entity
to
acquire
multiple tracts or units of property to construct facilities
connecting one location to another location, the governing body of
the governmental entity may adopt a single ordinance, resolution,
or order by a record vote that delegates the authority to initiate
condemnation proceedings to the chief administrative official of
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the governmental entity.
(g)
An
ordinance,
resolution,
or
order
adopted
under
Subsection (f) is not required to identify specific properties that
the governmental entity will acquire.
The ordinance, resolution,
or order must identify the general area to be covered by the
project or the general route that will be used by the governmental
entity for the project in a way that provides property owners in
and around the area or along the route reasonable notice that the
owners' properties may be subject to condemnation proceedings
during the planning or construction of the project.
SUBCHAPTER C.
EXPIRATION OF CERTAIN EMINENT DOMAIN AUTHORITY
Sec. 2206.101.
OF AUTHORITY.
(a)
REPORT OF EMINENT DOMAIN AUTHORITY; EXPIRATION
This section does not apply to an entity that
was created or that acquired the power of eminent domain on or
after December 31, 2012.
(b)
Not later than December 31, 2012, an entity, including a
private entity, authorized by the state by a general or special law
to exercise the power of eminent domain shall submit to the
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comptroller a letter stating that the entity is authorized by the
state to exercise the power of eminent domain and identifying each
provision of law that grants the entity that authority.
The entity
must send the letter by certified mail, return receipt requested.
(c)
The authority of an entity to exercise the power of
eminent domain expires on September 1, 2013, unless the entity
submits a letter in accordance with Subsection (b).
(d)
Not later than March 1, 2013, the comptroller shall
submit to the governor, the lieutenant governor, the speaker of the
house of representatives, the presiding officers of the appropriate
standing committees of the senate and the house of representatives,
and the Texas Legislative Council a report that contains:
(1)
the name of each entity that submitted a letter in
accordance with this section; and
(2)
eminent
domain
a corresponding list of the provisions granting
authority
as
identified
by
each
entity
that
submitted a letter.
(e)
The
Texas
Legislative
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Council
shall
prepare
for
consideration
by
the
84th
Legislature,
Regular
S.B. No. 18
Session, a
nonsubstantive revision of the statutes of this state as necessary
to reflect the state of the law after the expiration of an entity's
eminent domain authority effective under Subsection (c).
SECTION 3.
Subsection (a), Section 251.001, Local Government
Code, is amended to read as follows:
(a)
When the governing body of a municipality considers it
necessary, the municipality may exercise the right of eminent
domain for a public use [purpose] to acquire public or private
property, whether located inside or outside the municipality, for
any of the following uses [purposes]:
(1)
the
providing,
enlarging,
or
improving
of
a
municipally owned city hall; police station; jail or other law
enforcement detention facility; fire station; library; school or
other
educational
facility;
academy;
auditorium;
hospital;
sanatorium; market house; slaughterhouse; warehouse; elevator;
railroad terminal; airport; ferry; ferry landing; pier; wharf; dock
or other shipping facility; loading or unloading facility; alley,
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street, or other roadway; park, playground, or other recreational
facility; square; water works system, including reservoirs, other
water supply sources, watersheds, and water storage, drainage,
treatment, distribution, transmission, and emptying facilities;
sewage system including sewage collection, drainage, treatment,
disposal, and emptying facilities; electric or gas power system;
cemetery; and crematory;
(2)
the determining of riparian rights relative to the
municipal water works;
(3)
the straightening or improving of the channel of any
stream, branch, or drain;
(4)
the straightening, widening, or extending of any
alley, street, or other roadway; and
(5)
[for] any other municipal public use [purpose] the
governing body considers advisable.
SECTION 4.
Subsection (a), Section 261.001, Local Government
Code, is amended to read as follows:
(a)
A county may exercise the right of eminent domain to
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condemn and acquire land, an easement in land, or a right-of-way if
the acquisition is necessary for the construction of a jail,
courthouse,
hospital,
or
library,
or
for
another
public
use
[purpose] authorized by law.
SECTION 5.
Subsection (c), Section 263.201, Local Government
Code, is amended to read as follows:
(c)
The declaration of taking must contain:
(1)
a declaration that the land or interest in land
described in the original petition is taken for a public use
[purpose] and for ultimate conveyance to the United States;
(2)
a
description
of
the
land
sufficient
for
the
identification of the land;
(3)
a statement of the estate or interest in the land
being taken;
(4)
a statement of the public use to be made of the
(5)
a plan showing the land being taken; and
(6)
a statement of the amount of damages awarded by the
land;
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special commissioners, or by the jury on appeal, for the taking of
the land.
SECTION 6.
Section 273.002, Local Government Code, is amended
to read as follows:
Sec. 273.002.
CONDEMNATION.
Condemnation of property under
this chapter shall be in accordance with state law relating to
eminent domain, which may be Chapter 21, Property Code, or any
other state law governing and relating to the condemnation of land
for public use [purposes] by a municipality.
SECTION 7.
Section 21.0111, Property Code, is amended to read
as follows:
Sec. 21.0111.
INITIAL OFFER.
(a)
DISCLOSURE OF CERTAIN INFORMATION REQUIRED;
An [A governmental] entity with eminent domain
authority that wants to acquire real property for a public use
shall, by certified mail, return receipt requested, disclose to the
property owner at the time an offer to purchase or lease the
property is made any and all [existing] appraisal reports produced
or acquired by the [governmental] entity relating specifically to
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the owner's property and prepared in the 10 years preceding the
date of the [used in determining the final valuation] offer.
(b)
A
property
owner
shall
disclose
to
the
[acquiring
governmental] entity seeking to acquire the property any and all
current and existing appraisal reports produced or acquired by the
property owner relating specifically to the owner's property and
used in determining the owner's opinion of value.
Such disclosure
shall take place not later than the earlier of:
(1)
the 10th day after the date [within 10 days] of
receipt of an appraisal report; or
(2)
the third business day before the date of a special
commissioner's hearing if an appraisal report is to be used at the
[reports
but
no
later
than
10
days
prior
to
the
special
commissioner's] hearing.
(c)
An entity seeking to acquire property that the entity is
authorized to obtain through the use of eminent domain may not
include a confidentiality provision in an offer or agreement to
acquire the property.
The entity shall inform the owner of the
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property that the owner has the right to:
(1)
discuss
any
offer
or
agreement
regarding
the
entity's acquisition of the property with others; or
(2)
keep the offer or agreement confidential, unless the
offer or agreement is subject to Chapter 552, Government Code.
(d)
A subsequent bona fide purchaser for value from the
acquiring [governmental] entity may conclusively presume that the
requirement of this section has been met.
apply
to
acquisitions
of
real
This section does not
property
for
which
an
[a
governmental] entity does not have eminent domain authority.
SECTION 8.
Subchapter
B,
Chapter
21,
Property
Code,
is
amended by adding Section 21.0113 to read as follows:
Sec. 21.0113.
BONA FIDE OFFER REQUIRED.
(a)
An entity with
eminent domain authority that wants to acquire real property for a
public use must make a bona fide offer to acquire the property from
the property owner voluntarily.
(b)
An entity with eminent domain authority has made a bona
fide offer if:
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(1)
S.B. No. 18
an initial offer is made in writing to a property
(2)
a final offer is made in writing to the property
(3)
the final offer is made on or after the 30th day
owner;
owner;
after the date on which the entity makes a written initial offer to
the property owner;
(4)
before making a final offer, the entity obtains a
written appraisal from a certified appraiser of the value of the
property being acquired and the damages, if any, to any of the
property owner's remaining property;
(5)
the final offer is equal to or greater than the
amount of the written appraisal obtained by the entity;
(6)
the following items are included with the final
offer or have been previously provided to the owner by the entity:
(A)
a copy of the written appraisal;
(B)
a
copy
of
the
deed,
easement,
or
instrument conveying the property sought to be acquired; and
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other
(C)
the
landowner's
bill
of
S.B. No. 18
rights statement
prescribed by Section 21.0112; and
(7)
the entity provides the property owner with at least
14 days to respond to the final offer and the property owner does
not agree to the terms of the final offer within that period.
SECTION 9.
Section 21.012, Property Code, is amended to read
as follows:
Sec. 21.012.
CONDEMNATION PETITION.
(a)
If an entity [the
United States, this state, a political subdivision of this state, a
corporation] with eminent domain authority[, or an irrigation,
water improvement, or water power control district created by law]
wants to acquire real property for public use but is unable to
agree with the owner of the property on the amount of damages, the
[condemning] entity may begin a condemnation proceeding by filing a
petition in the proper court.
(b)
The petition must:
(1)
describe the property to be condemned;
(2)
state with specificity the public use [purpose] for
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which the entity intends to acquire [use] the property;
(3)
state the name of the owner of the property if the
owner is known;
(4)
state that the entity and the property owner are
unable to agree on the damages; [and]
(5)
if applicable, state that the entity provided the
property owner with the landowner's bill of rights statement in
accordance with Section 21.0112; and
(6)
acquire
the
state that the entity made a bona fide offer to
property
from
the
property
owner
voluntarily
as
provided by Section 21.0113.
(c)
An entity that files a petition under this section must
provide a copy of the petition to the property owner by certified
mail, return receipt requested.
SECTION 10.
Subsection (a), Section 21.014, Property Code, is
amended to read as follows:
(a)
The judge of a court in which a condemnation petition is
filed or to which an eminent domain case is assigned shall appoint
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three disinterested real property owners [freeholders] who reside
in the county as special commissioners to assess the damages of the
owner of the property being condemned.
The judge appointing the
special commissioners shall give preference to persons agreed on by
the parties.
The judge shall provide each party a reasonable
period to strike one of the three commissioners appointed by the
judge.
by
a
If a person fails to serve as a commissioner or is struck
party
to
the
suit,
the
judge
shall
[may]
appoint
a
replacement.
SECTION 11.
Subsection (a), Section 21.015, Property Code, is
amended to read as follows:
(a)
The special commissioners in an eminent domain proceeding
shall promptly schedule a hearing for the parties at the earliest
practical time but may not schedule a hearing to assess damages
before the 20th day after the date the special commissioners were
appointed.
The special commissioners shall schedule a hearing for
the parties [and] at a place that is as near as practical to the
property being condemned or at the county seat of the county in
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which the proceeding is being held.
SECTION 12.
Subsection (b), Section 21.016, Property Code, is
amended to read as follows:
(b)
Notice of the hearing must be served on a party not later
than the 20th [11th] day before the day set for the hearing.
A
person competent to testify may serve the notice.
SECTION 13.
Section 21.023, Property Code, is amended to read
as follows:
Sec. 21.023.
ACQUISITION.
DISCLOSURE OF INFORMATION REQUIRED AT TIME OF
An [A governmental] entity with eminent domain
authority shall disclose in writing to the property owner, at the
time of acquisition of the property through eminent domain, that:
(1)
the owner or the owner's heirs, successors, or
assigns may be [are] entitled to:
(A)
repurchase the property under Subchapter E [if
the public use for which the property was acquired through eminent
domain is canceled before the 10th anniversary of the date of
acquisition]; or
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request from the entity certain information
(B)
relating to the use of the property and any actual progress made
toward that use; and
(2)
the repurchase price is the price paid to the owner
by the entity at the time the entity acquired the property through
eminent domain [fair market value of the property at the time the
public use was canceled].
SECTION 14.
Subchapter
B,
Chapter
21,
Property
Code,
is
amended by adding Section 21.025 to read as follows:
Sec. 21.025.
(a)
PRODUCTION OF INFORMATION BY CERTAIN ENTITIES.
Notwithstanding any other law, an entity that is not subject
to Chapter 552, Government Code, and is authorized by law to
acquire private property through the use of eminent domain is
required to produce information as provided by this section if the
information is:
(1)
requested by a person who owns property that is the
subject of a proposed or existing eminent domain proceeding; and
(2)
related
to
the
taking
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of
the
person's
private
S.B. No. 18
property by the entity through the use of eminent domain.
(b)
this
An entity described by Subsection (a) is required under
section
only
to
produce
information
relating
to
the
condemnation of the specific property owned by the requestor as
described in the request.
A request under this section must
contain sufficient details to allow the entity to identify the
specific tract of land in relation to which the information is
sought.
(c)
The entity shall respond to a request in accordance with
the Texas Rules of Civil Procedure as if the request was made in a
matter pending before a state district court.
(d)
Texas
Exceptions to disclosure provided by this chapter and the
Rules
of
Civil
Procedure
apply
to
the
disclosure
of
information under this section.
(e)
Jurisdiction to enforce the provisions of this section
resides in:
(1)
the court in which the condemnation was initiated;
or
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(2)
if
the
condemnation
proceeding
S.B. No. 18
has not been
initiated:
(A)
a court that would have jurisdiction over a
proceeding to condemn the requestor's property; or
(B)
a court with eminent domain jurisdiction in the
county in which the entity has its principal place of business.
(f)
If the entity refuses to produce information requested in
accordance with this section and the court determines that the
refusal violates this section, the court may award the requestor's
reasonable attorney's fees incurred to compel the production of the
information.
SECTION 15.
Subsection (d), Section 21.042, Property Code, is
amended to read as follows:
(d)
In estimating injury or benefit under Subsection (c), the
special commissioners shall consider an injury or benefit that is
peculiar to the property owner and that relates to the property
owner's ownership, use, or enjoyment of the particular parcel of
real property, including a material impairment of direct access on
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S.B. No. 18
or off the remaining property that affects the market value of the
remaining property, but they may not consider an injury or benefit
that the property owner experiences in common with the general
community, including circuity of travel and diversion of traffic.
In this subsection, "direct access" means ingress and egress on or
off a public road, street, or highway at a location where the
remaining property adjoins that road, street, or highway.
SECTION 16.
Subsections (a) and (b), Section 21.046, Property
Code, are amended to read as follows:
(a)
A
department,
agency,
instrumentality,
or
political
subdivision of this state shall [may] provide a relocation advisory
service for an individual, a family, a business concern, a farming
or ranching operation, or a nonprofit organization that [if the
service]
is
compatible
with
the
Federal
Uniform
Relocation
Assistance and Real Property Acquisition Policies Act of 1970
[Advisory Program], 42 U.S.C.A. 4601 [23 U.S.C.A. 501], et seq.
(b)
This state or a political subdivision of this state shall
[may], as a cost of acquiring real property, pay moving expenses
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S.B. No. 18
and rental supplements, make relocation payments, provide financial
assistance to acquire replacement housing, and compensate for
expenses
incidental
to
the
transfer
of
the
property
if
an
individual, a family, the personal property of a business, a
farming or ranching operation, or a nonprofit organization is
displaced in connection with the acquisition.
SECTION 17.
The heading to Section 21.047, Property Code, is
amended to read as follows:
Sec. 21.047.
SECTION 18.
ASSESSMENT OF COSTS AND FEES.
Section 21.047, Property Code, is amended by
adding Subsection (d) to read as follows:
(d)
If a court hearing a suit under this chapter determines
that a condemnor did not make a bona fide offer to acquire the
property from the property owner voluntarily as required by Section
21.0113, the court shall abate the suit, order the condemnor to
make a bona fide offer, and order the condemnor to pay:
(1)
all costs as provided by Subsection (a); and
(2)
any
reasonable
attorney's
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fees
and
other
S.B. No. 18
professional fees incurred by the property owner that are directly
related to the violation.
SECTION 19.
Subchapter
E,
Chapter
21,
Property
Code,
is
amended to read as follows:
SUBCHAPTER E.
REPURCHASE OF REAL PROPERTY FROM CONDEMNING
[GOVERNMENTAL] ENTITY
Sec. 21.101.
RIGHT OF REPURCHASE [APPLICABILITY].
(a)
A
person from whom [Except as provided in Subsection (b), this
subchapter applies only to] a real property interest is acquired by
an [a governmental] entity through eminent domain for a public use,
or that person's heirs, successors, or assigns, is entitled to
repurchase the property as provided by this subchapter if:
(1)
the public use for which the property was acquired
through eminent domain is [that was] canceled before the property
is used for that public use;
(2)
no actual progress is made toward the public use for
which the property was acquired between the date of acquisition and
the 10th anniversary of that date; or
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(3)
S.B. No. 18
the property becomes unnecessary for the public use
for which the property was acquired, or a substantially similar
public use, before the 10th anniversary of the date of acquisition.
(b)
In this section, "actual progress" means the completion
of two or more of the following actions:
(1)
the performance of a significant amount of labor to
develop the property or other property acquired for the same public
use project for which the property owner's property was acquired;
(2)
the provision of a significant amount of materials
to develop the property or other property acquired for the same
public use project for which the property owner's property was
acquired;
(3)
the hiring of and performance of a significant
amount of work by an architect, engineer, or surveyor to prepare a
plan or plat that includes the property or other property acquired
for the same public use project for which the property owner's
property was acquired;
(4)
application for state or federal funds to develop
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the property or other property acquired for the same public use
project for which the property owner's property was acquired;
(5)
application for a state or federal permit to develop
the property or other property acquired for the same public use
project for which the property owner's property was acquired;
(6)
the
acquisition
of
a
tract
or
parcel
of
real
property adjacent to the property for the same public use project
for which the owner's property was acquired; or
(7)
for
a
governmental
entity,
the
adoption
by
a
majority of the entity's governing body at a public hearing of a
development plan for a public use project that indicates that the
entity
will
not
complete
more
than
one
action
described
by
Subdivisions (1)-(6) before the 10th anniversary of the date of
acquisition of the property [This subchapter does not apply to a
right-of-way under the jurisdiction of:
[(1)
a county;
[(2)
a municipality; or
[(3)
the Texas Department of Transportation].
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(c)
S.B. No. 18
A district court may determine all issues in any suit
regarding the repurchase of a real property interest acquired
through eminent domain by the former property owner or the owner's
heirs, successors, or assigns.
Sec. 21.102.
NOTICE TO PREVIOUS PROPERTY OWNER REQUIRED [AT
TIME OF CANCELLATION OF PUBLIC USE].
Not later than the 180th day
after the date an entity that acquired a real property interest
through eminent domain determines that the former property owner is
entitled to repurchase the property under Section 21.101 [of the
cancellation of the public use for which real property was acquired
through eminent domain from a property owner under Subchapter B],
the [governmental] entity shall send by certified mail, return
receipt requested, to the property owner or the owner's heirs,
successors, or assigns a notice containing:
(1)
an identification, which is not required to be a
legal description, of the property that was acquired;
(2)
an identification of the public use for which the
property had been acquired and a statement that:
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(A)
S.B. No. 18
the public use was [has been] canceled before
the property was used for the public use;
(B)
no actual progress was made toward the public
(C)
the property became unnecessary for the public
use; or
use,
or
a
substantially
similar
public
use,
before
the
10th
anniversary of the date of acquisition; and
(3)
a description of the person's right under this
subchapter to repurchase the property.
Sec. 21.1021.
PROPERTY.
(a)
REQUESTS FOR INFORMATION REGARDING CONDEMNED
On or after the 10th anniversary of the date on
which real property was acquired by an entity through eminent
domain, a property owner or the owner's heirs, successors, or
assigns may request that the condemning entity make a determination
and provide a statement and other relevant information regarding:
(1)
whether the public use for which the property was
acquired was canceled before the property was used for the public
use;
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(2)
S.B. No. 18
whether any actual progress was made toward the
public use between the date of acquisition and the 10th anniversary
of that date, including an itemized description of the progress
made, if applicable; and
(3)
whether the property became unnecessary for the
public use, or a substantially similar public use, before the 10th
anniversary of the date of acquisition.
(b)
A request under this section must contain sufficient
detail to allow the entity to identify the specific tract of land
in relation to which the information is sought.
(c)
Not later than the 90th day following the date of receipt
of the request for information, the entity shall send a written
response by certified mail, return receipt requested, to the
requestor.
Sec. 21.1022.
LIMITATIONS
PERIOD
FOR
REPURCHASE
RIGHT.
Notwithstanding Section 21.103, the right to repurchase provided by
this subchapter is extinguished on the first anniversary of the
expiration of the period for an entity to provide notice under
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S.B. No. 18
Section 21.102 if the entity:
(1)
is required to provide notice under Section 21.102;
(2)
makes a good faith effort to locate and provide
notice to each person entitled to notice before the expiration of
the deadline for providing notice under that section; and
(3)
does not receive a response to any notice provided
under that section in the period for response prescribed by Section
21.103.
Sec. 21.103.
RESALE OF PROPERTY; PRICE.
(a)
Not later than
the 180th day after the date of the postmark on a [the] notice sent
under Section 21.102 or a response to a request made under Section
21.1021 that indicates that the property owner, or the owner's
heirs, successors, or assigns, is entitled to repurchase the
property interest in accordance with Section 21.101, the property
owner or the owner's heirs, successors, or assigns must notify the
[governmental] entity of the person's intent to repurchase the
property interest under this subchapter.
(b)
As soon as practicable after receipt of a notice of
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S.B. No. 18
intent to repurchase [the notification] under Subsection (a), the
[governmental] entity shall offer to sell the property interest to
the person for the price paid to the owner by the entity at the
time the entity acquired the property through eminent domain [fair
market value of the property at the time the public use was
canceled].
The person's right to repurchase the property expires
on the 90th day after the date on which the [governmental] entity
makes the offer.
SECTION 20.
Section 202.021, Transportation Code, is amended
by adding Subsection (j) to read as follows:
(j)
The standard for determination of the fair value of the
state's interest in access rights to a highway right-of-way is the
same legal standard that is applied by the commission in the:
(1)
acquisition of access rights under Subchapter D,
Chapter 203; and
(2)
payment of damages in the exercise of the authority,
under Subchapter C, Chapter 203, for impairment of highway access
to or from real property where the real property adjoins the
Page -35 -
S.B. No. 18
highway.
SECTION 21.
Section 54.209, Water Code, is amended to read as
follows:
Sec. 54.209.
LIMITATION ON USE OF EMINENT DOMAIN.
A district
may not exercise the power of eminent domain outside the district
boundaries to acquire:
(1)
a site for a water treatment plant, water storage
facility, wastewater treatment plant, or wastewater disposal plant;
(2)
a
site
for
a
park,
swimming
pool,
or
other
recreational facility, as defined by Section 49.462 [except a
trail];
(3)
[a site for a trail on real property designated as a
homestead as defined by Section 41.002, Property Code; or
[(4)]
an exclusive easement through a county regional
park; or
(4)
a site or easement for a road project.
SECTION 22.
Section 1, Chapter 178 (S.B. 289), Acts of the
56th Legislature, Regular Session, 1959 (Article 3183b-1, Vernon's
Page -36 -
S.B. No. 18
Texas Civil Statutes), is amended to read as follows:
Sec. 1.
Except
as
provided
by
this
section,
and
notwithstanding any other law, any [Any] nonprofit corporation
incorporated under the laws of this state for purely charitable
purposes and which is directly affiliated or associated with a
medical center having a medical school recognized by the Council on
Medical Education and Hospitals of the American Medical Association
as an integral part of its establishment, and which has for a
purpose of its incorporation the provision or support of medical
facilities or services for the use and benefit of the public, and
which is situated in any county of this state having a population
in excess of six hundred thousand (600,000) inhabitants according
to the most recent Federal Census shall have the power of eminent
domain and condemnation for the purposes set forth in Section 2 and
Section 3 of this Act.
section
may
condemnation
not
to
A charitable corporation described by this
exercise
acquire
a
the
power
detached,
of
eminent
single-family
domain
and
residential
property or a multifamily residential property that contains eight
Page -37 -
S.B. No. 18
or fewer dwelling units.
SECTION 23.
(a)
Section
552.0037,
Government
Code,
is
repealed.
(b)
Section 21.024, Property Code, is repealed.
SECTION 24.
Section 11.155, Education Code, Chapter 2206,
Government Code, Sections 251.001, 261.001, 263.201, and 273.002,
Local Government Code, Chapter 21, Property Code, and Section 1,
Chapter 178 (S.B. 289), Acts of the 56th Legislature, Regular
Session, 1959 (Article 3183b-1, Vernon's Texas Civil Statutes), as
amended by this Act, apply only to a condemnation proceeding in
which the petition is filed on or after the effective date of this
Act and to any property condemned through the proceeding.
A
condemnation proceeding in which the petition is filed before the
effective date of this Act and any property condemned through the
proceeding are governed by the law in effect immediately before
that date, and that law is continued in effect for that purpose.
SECTION 25.
The change in law made by this Act to Section
202.021, Transportation Code, applies only to a sale or transfer
Page -38 -
S.B. No. 18
under that section that occurs on or after the effective date of
this Act.
A sale or transfer that occurs before the effective date
of this Act is governed by the law applicable to the sale or
transfer immediately before the effective date of this Act, and
that law is continued in effect for that purpose.
SECTION 26.
The changes in law made by this Act to Section
54.209, Water Code, apply only to a condemnation proceeding in
which the petition is filed on or after the effective date of this
Act.
A condemnation proceeding in which the petition is filed
before the effective date of this Act is governed by the law in
effect on the date the petition was filed, and that law is
continued in effect for that purpose.
SECTION 27.
This Act takes effect September 1, 2011.
Page -39 -
S.B. No. 18
______________________________
President of the Senate
I
hereby
February
9,
certify
2011,
that
by
the
______________________________
Speaker of the House
S.B. No. 18
following
passed
vote:
the
Senate
Yeas 31,
on
Nays 0;
April 19, 2011, Senate refused to concur in House amendments and
requested appointment of Conference Committee; April 28, 2011,
House granted request of the Senate; May 6, 2011, Senate adopted
Conference
Committee
Report
by
the
following
vote:
Yeas 30,
Nays 0.
______________________________
Secretary of the Senate
I hereby certify that S.B. No. 18 passed the House, with
amendments, on April 14, 2011, by the following vote:
Yeas 144,
Nays 0, one present not voting; April 28, 2011, House granted
request of the Senate for appointment of Conference Committee;
Page -40 -
S.B. No. 18
May 5, 2011, House adopted Conference Committee Report by the
following vote:
Yeas 145, Nays 0, two present not voting.
______________________________
Chief Clerk of the House
Approved:
______________________________
Date
______________________________
Governor
Page -41 -
TAB “2”
TOWN OF METROPOLIS, TEXAS
RESOLUTION NO. _________
A RESOLUTION OF THE TOWN COUNCIL OF THE TOWN OF METROPOLIS, TEXAS,
DECLARING THE NECESSITY TO ACQUIRE FEE SIMPLE TITLE TO 0.2369 ACRES
(10,320 SQUARE FEET) OF LAND SITUATED IN THE LEX LUTHOR SURVEY,
ABSTRACT NO. 50, IN SHERLOCK COUNTY, TEXAS, WITH A STREET ADDRESS OF
221B BAKER STREET, IN THE TOWN OF METROPOLIS, TEXAS, FOR ROADWAY
EXPANSION/RECONSTRUCTION AND ASSOCIATED DRAINAGE/ UTILITY USES;
DETERMINING THE PUBLIC NECESSITY FOR SUCH ACQUISITION; AUTHORIZING
THE ACQUISITION OF PROPERTY RIGHTS NECESSARY FOR THE ROADWAY
EXPANSION/ RECONSTRUCTION PROJECT AND ASSOCIATED DRAINAGE/UTILITY
USES; APPOINTING AN APPRAISER AND NEGOTIATOR AS NECESSARY;
AUTHORIZING THE TOWN ADMINISTRATOR OF THE TOWN OF METROPOLIS,
TEXAS, TO ESTABLISH JUST COMPENSATION FOR THE PROPERTY RIGHTS TO BE
ACQUIRED; AUTHORIZING THE TOWN ADMINISTRATOR OR DESIGNEE TO TAKE
ALL STEPS NECESSARY TO ACQUIRE THE NEEDED PROPERTY RIGHTS IN
COMPLIANCE WITH ALL APPLICABLE LAWS AND RESOLUTIONS; AND
AUTHORIZING THE TOWN ATTORNEY OR DESIGNEE TO INSTITUTE
CONDEMNATION PROCEEDINGS TO ACQUIRE THE PROPERTY IF PURCHASE
NEGOTIATIONS ARE NOT SUCCESSFUL.
WHEREAS, the Town Council of the Town of Metropolis, Texas (“Town Council”), has
determined that 0.2369 acres (10,230 square feet) of land situated in the Lex Luthor Survey, Abstract
No. 50, in Sherlock County, Texas, with a street address of 221B Baker Street, Metropolis, Texas
(“Doctor Watson Drive Property”), a legal description of which is attached hereto, is appropriate for
use by the Town of Metropolis for the Town’s roadway expansion/reconstruction and associated
drainage and utility uses (“Roadway Project”), and that there exists a public necessity to acquire the
Doctor Watson Drive Property, in fee simple title, for the Town of Metropolis’ Roadway Project;
and
WHEREAS, the Town Council desires to acquire the Doctor Watson Drive Property for the
aforementioned public uses in conjunction with the Roadway Project because, in part, additional
right-of-way is necessary for emergency vehicle operations on the Doctor Watson Drive cul-de-sac in
the Town of Metropolis, Texas; and
WHEREAS, the Town Council desires that the Town Administrator, or designee, take all
necessary steps to acquire the needed property interests, including but not limited to the retention of
appraisers, engineers and other consultants and experts, and that the Town Attorney, or designee,
negotiate the purchase of the property interests and, if unsuccessful in purchasing the needed
property interests, to institute condemnation proceedings to acquire the Doctor Watson Drive
Property.
1
NOW, THEREFORE, BE IT RESOLVED BY THE TOWN COUNCIL OF THE
TOWN OF METROPOLIS, TEXAS, THAT:
SECTION 1
All of the above premises are hereby found to be true and correct legislative and factual
findings of the Town Council of the Town of Metropolis, Texas, and they are hereby approved and
incorporated into the body of this resolution as if copied in their entirety.
SECTION 2
The Town Council hereby finds and determines that a public use and necessity exists for the
Town of Metropolis to expand/reconstruct the Doctor Watson Drive cul-de-sac and undertake
associated drainage and utility improvements as part of the Roadway Project, and to acquire the
necessary property rights in the Doctor Watson Drive Property deemed necessary for
expansion/reconstruction of the Roadway Project, as allowed by law, together with all necessary
appurtenances, additions and improvements on, over, under, and through those certain lots, tracts or
parcels of land.
SECTION 3
The Town Attorney, or designee, is authorized and directed to negotiate for and to acquire the
required property rights for the Town of Metropolis, and to acquire said rights in compliance with
State and Federal law. Moreover, the Town Attorney, or designee, is specifically authorized and
directed to do each and every act necessary to acquire the needed property rights including, but not
limited to, the authority to negotiate, give notices, make written offers to purchase, prepare contracts,
to retain and designate a qualified appraiser of the property interests to be acquired, as well as any
other experts or consultants that deemed necessary for the acquisition process and, if necessary, to
institute proceedings in eminent domain.
SECTION 4
The Town Administrator, or designee, is appointed as negotiator for the acquisition of the
needed property interests and, as such, the Town Administrator or designee is authorized and
directed to do each and every act and deed hereinabove specified or authorized by reference, subject
to the availability of funds appropriated by the Town Council for such purpose. Further, the Town
Administrator or designee is specifically authorized to establish the just compensation for the
acquisition of the Doctor Watson Drive Property. Additionally, if the Town Administrator or
designee determines that an agreement as to damages or compensation cannot be reached, then the
Town Attorney or designee is hereby authorized and directed to file or cause to be filed, against the
owner(s) and interested parties of the needed property interests, proceedings in eminent domain to
acquire the above-stated interests in the Doctor Watson Drive Property.
2
SECTION 5
This resolution shall become effective from and after its passage.
DULY RESOLVED by the Town Council of the Town of Metropolis, Texas, on this the
_______ day of Nevermore, 2012.
____________________________________
Clark Kent, Mayor
ATTEST:
_________________________________
Lois Lane, Town Secretary
APPROVED AS TO FORM AND LEGALITY:
____________________________________
Superman, Town Attorney
3
TAB “3”
[Date]
[Owner Address]
Re:
Acquisition of 167,159 square feet (3.837 acres) for use as Right-of-Way,
27,567 square feet (0.633 acres) for use as a Gas Pipeline Easement, 11,786
square feet (0.271 acres) for use as a Temporary Construction Easement, 450
square feet (0.010 acres) for use as a Drainage Easement and an additional
937 square foot (0.021 acres) for a Temporary Construction Easement, all
located in the Tony Stark Survey, Abstract No. 575, Avengers County, Texas
in association with Infrastructure Improvements and Widening of Batman
Parkway.
Dear Owner:
As you know, it is necessary for the City of Gotham City to construct portions of Batman
Parkway, Catwoman Lane and associated utilities. The construction of these necessary
infrastructure improvements requires the purchase of the property referred to above. Inasmuch
as negotiations to purchase this property have not been successful to date, a final offer is hereby
submitted to you. The total sum of One Gizillion Dollars ($_________) is offered in settlement
for the required property rights, which includes 3.837 acres of land for use as right-of-way, 0.633
acres of land for use as a gas pipeline easement, 0.271 acres for use as a temporary construction
easement, 0.010 acres for use as a drainage easement and 0.021 acres for use as a temporary
construction easement, save and except oil, gas and sulphur rights with no right of exploration on
the above described property, subject to clear title being secured.
Any compensation that may be due to you or a tenant for Relocation Assistance is not included
in this offer, in that such funds are paid to eligible persons separately through the City’s
relocation assistance program.
If you desire to accept this offer, please sign below and return this original signed offer letter to
my office. Upon receipt of the accepted offer, the City will notify the title company to initiate a
closing. If this offer is not accepted within 14 days from the date of delivery of this letter, it will
be considered as having been rejected. We enclose herein, for your records and review, a draft
copy of the proposed instruments by which the property or property interest would be conveyed
to the City. A final copy of the documents will be signed at time of settlement. We have also
enclosed a second copy of the Landowner’s Bill of Rights and the appraisal by Commissioner
Gordon Appraisal Services. [If applicable: I have also enclosed copies of all appraisal reports
relating to your property being acquired which were prepared in the ten (10) years
preceding the date of this offer and produced or acquired by the City.]
If you elect to reject this offer, eminent domain proceedings will be initiated by the City.
Thereafter, the Court will appoint three disinterested real property owners who reside in the
County to serve as Special Commissioners, a date will be set for a hearing and you will be
notified of the time and place set for the hearing at which the Special Commissioners will hear
the evidence presented and arrive at an award which will be filed with the Court. The City may
then deposit the amount of the award with the Court, at which time the City will be entitled to
take possession of the property involved. After the deposit is made, you may withdraw your
share of the award. If the award exceeds the amount of any subsequent judgment, you are
required to repay the City the excess amount. If either you or the City is dissatisfied with the
amount of the Special Commissioners’ award, objections may be filed within the time prescribed
by law and the case subsequently tried before the Court as are other civil cases.
You have the right to discuss with others any offer or agreement regarding the City’s acquisition
of the subject property, or you may (but are not required to) keep the offer or agreement
confidential from others, subject to the provisions of Chapter 552, Government Code (the Public
Records Act) as it may apply to the City.
Do not hesitate to call my office at 1-800-WE-WILL-SUE, should you have any questions
regarding the acquisition process.
Sincerely,
Dragon Lady
City of Gotham City
Real Estate Acquisitions Administrator
AGREED:
Owner
ENCLOSURES:
Draft proposed conveyance instrument(s)
Landowner Bill of Rights
Copy of Appraisal by Certified Appraiser
TAB “4”
Timeline of dates under Senate Bill 18
This process may begin prior to or after the adoption of a condemnation resolution:
Day 1
Initial offer made in writing to Property Owner. The initial offer does not have to
include or be based on an appraisal; however, there is no prohibition from the initial
offer being based on an appraisal. Must include a Landowner’s Bill of Rights. A
confidentiality provision must not be included. City shall inform Property Owner of
his/her right to: (1) discuss offer with others; or (2) keep the offer confidential.
Day 31
Final offer made in writing to Property Owner. The final offer must be based on a
written appraisal obtained by the City from a certified appraiser regarding the value
of the property acquired and damages, if any, to the remainder of the property. This
offer must be greater than or equal to the appraisal. The City shall inform Property
Owner of his/her right to: (1) discuss offer with others; or (2) keep the offer
confidential. Property Owner must be given at least 14 days to respond to final offer.
Must include a copy of the following with the final offer:
(a)
(b)
(c)
Written, certified appraisal;
Proposed conveyance instrument; and
Landowner’s Bill of Rights, if not previously provided.
Day 45
Last day to accept final offer if only 14 days are allowed by the City to respond to
final offer.
Day 46
Condemnation Petition may be filed – in accordance with Texas Property Code
21.012. Motion to Appoint Special Commissioners also filed. Certified copy of
Petition must be provided to Property Owner.
SC - 1
Appointment of Special Commissioners. Depending on the court, this usually occurs
between 1 – 5 days after the date the Petition is filed. Receipt of Special
Commissioners Appointment. Assuming that this information is received
immediately, which may not always be the case, the hearing may be set not earlier
than 20 days from today (see below). Commissioners contacted and hearing set, City
receives signed Notice of Hearing from Commissioners. [Approximately 48 days
from Day 1]
SC-22
Earliest Commissioners’ hearing date. Landowner must be served not later than 20
days before the hearing. Hearing must be at least 20 days after commissioners are
appointed. This date presumes that the Property Owner can be served in one day.
[Approximately 60 days from Day 1]
TAB “5”
APPRAISAL GUIDANCE MEMO: DAMAGES FOR IMPAIRMENT
OF ACCESS
Material Impairment of Direct Access Damage Standard - Effective
September 1, 2011, the Texas Property Code, Section 21.042, established a
new standard for determining whether a property owner is entitled to
damages for impairment of access resulting from the acquisition of property.
The statute provides that:
(d) In estimating injury or benefit under Subsection (c), the special
commissioners shall consider an injury or benefit that is peculiar to the
property owner and that relates to the property owner's ownership, use,
or enjoyment of the particular parcel of real property, including a
material impairment of direct access on or off the remaining property
that affects the market value of the remaining property, but they may
not consider an injury or benefit that the property owner experiences
in common with the general community, including circuity of travel
and diversion of traffic. In this subsection, “'direct access” means
ingress and egress on or off a public road, street, or highway at a
location where the remaining property adjoins that road, street, or
highway (italics added for emphasis).
Comparison to Prior Access Damage Standard - The prior standard of
“material and substantial impairment of access” focused on access to the
entire remainder and asked whether there was still “reasonable access” to the
remainder after the city’s restriction of access. Access to a different
secondary public road could constitute reasonable access resulting in a
finding of no material and substantial impairment of access.
The new standard focuses on direct access to the property from the public
highway. The operative factors are whether the impairment to “direct access”
(ingress and egress on and off the remaining property to or from the
improved public highway) is “material” and, if so, whether it “affects the
market value of the remaining property.” Additional access to a different
secondary public road may or may not prevent a finding of material
impairment of direct access, depending upon the specific facts. However, a
total denial of direct access cannot be completely replaced by other access to
a different secondary public road.
Appraisal Instruction:
A.
A “material impairment” of direct access is one that is significant or
important. Although the change must be significant or important, it no
longer must be “substantial” (meaning considerable or large).
B.
In determining whether impaired access is material, the appraiser must
look to whether other access points remain after the acquisition and
whether those access points are sufficient to allow the remainder to
have similar utility. The concept of access impairment is not to be
fragmented into a mathematical equation to focus only on the number
of feet or percentage of closed access points.
C.
The appraiser should look at both the physical changes to ingress
and egress on and off the remaining property and the anticipated
impact on the use of the property to determine if the restriction is
significant. Remaining access should be analyzed in light of the
actual use of the remainder property as reflected by existing uses and
improvements and applicable zoning unless the appraiser has
concluded that the highest and best use of the property is different
than its actual use. If the appraiser has concluded that the highest and
best use of the property is different than its actual use, then
remaining access should be analyzed in light of that highest and best
use; making sure to avoid speculative or hypothetical uses that are
not reasonably probable within the immediate future or within a
reasonable time. Some of the factors to consider in the before and
after scenario are:
1.
the number, location, and width of existing, permissible,
or permitted driveways;
2.
extent of difficulty for large trucks or other unique vehicles to
enter the property (if that is the normal use of the property at the
time of impairment);
3.
the manner in which the access impairment affects the
functionality of existing improvements;
4.
whether the remaining property has access to another public
road(s) (this is now just one factor and it may affect the analysis
in two different ways:
a.
it does not automatically prevent a finding of material
impairment of ingress and egress on and off the
remaining property from the road as it might under prior
law, but access to another public road may have an effect
on the determination of material impairment of direct
access; and
b.
if there is a determination that a material impairment of
direct access did occur, a property's access to another
public road may then have an effect on the difference in
market value, if any); and
2
5.
whether it changes the highest and best use of the remainder
(again, this is not determinative of “materiality,” but is just one
factor to be considered in making that determination). Material
impairment cannot be based on speculative or hypothetical uses
of the remainder property. Prospective highest and best uses
must be reasonably probable within the immediate future or
within a reasonable time.
D.
“Circuity of travel” and “diversion of traffic” are specifically excluded
from the concept of material impairment of ingress and egress on and
off the remaining property.
E.
“Damages to remainder property” are generally calculated by the
difference between the market value of the remainder property
immediately before and after the condemnation, considering the nature
of any improvements and the use of the land acquired.
Statements in Appraisal Instruction - Every appraisal must contain the
following statement:
The appraiser has considered access damages in accordance with
Section 21.042(d) of the Texas Property Code, as amended by SB 18 of
the Texas 82nd Regular Legislative Session, and finds as follows:
1.
Is there a denial of direct access on this parcel? _____ (yes
or no)
2.
If so, is the denial of direct access material? _____ (yes, no,
or not applicable)
3.
The lack of any access denial or the material impairment of
direct access on or off the remaining property affects the
market value of the remaining property in the sum of
$________.
All three blanks must be completed for every appraisal.
If there is no denial of access on the property, then the answer to Question
#1 is no, Question #2 is not applicable, and Question #3 is $0.00.
If there is a denial of access, the appraiser must determine if it is a material
impairment of direct access on or off the remainder that affects the market
value of the remaining property. Some parcels may not have a material
denial of access, so the sum attributable to the effect of market value would
be $0.00. Some parcels may have a material denial, but the denial does not
affect the market value; therefore the sum would be $0.0.
3
For each appraisal, there must be a sum attributable to access denial, even
when there is no access denial and that sum is $0.00.